Private Retirement Scheme Started?
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 Sep 5 2012, 01:43 PM
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#1
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Junior Member
291 posts Joined: Dec 2007 
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QUOTE(wodenus @ Sep 5 2012, 01:11 PM) What's the difference? Personal income tax payable (i guess  compare PRS and RSP, and someone putting in a fixed amount every month, and tell me what the difference is   ) |
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Sep 5 2012, 04:15 PM
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#2
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Junior Member
291 posts Joined: Dec 2007
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QUOTE(wodenus @ Sep 5 2012, 01:59 PM) Cool.. now figure out if your taxes are going to be less if you have a Rm3000 tax relief. If not then it makes no difference right? 3% of RM3k = RM907% of RM3k = RM210 12% of RM3k = RM360 . . . . . might not be significant to u... but it is still $$$ ma~~  well, what regular savings plan offers?? |
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Nov 29 2012, 01:46 PM
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#3
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Junior Member
291 posts Joined: Dec 2007
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QUOTE(creativ @ Nov 29 2012, 10:47 AM) I Agree. just wondering, how many ppl @ 35 years old pay tax @ 26%? I don't agree. There is actually something new. Tax relief for 10 years, and if compounded annually until you're 55, the annualized return rate will cover the Management Expense Ratio (1.5%) and Sales Load (3%). In other words, PRS is Unit Trust without fees  ! (and without liquidity  ) A smart investor will know that fund fees is the number 1 drag to your long term fund return relative to the market returns. I have done the calculations. You can download the excel spreadheet --> Download Excel Spreadsheet from this Post Example scenario: If I'm 35 years old, and my tax rate is 26%. I contribute RM 3000 for 10 years (only) to take advantage of the tax relief. Assuming the PRS fund has 0% returns (that means no profit, no loss), then my Annual Compounded Interest is 1.95% until 55 years old. This is enough to cover for the "Yearly" Management Expense Ratio (1.5% of your total fund value) and Sales "Front" Load (3%). CODE Age Year Fund Contribution Fund Fund Value Income Tax Income Tax Total Return Amount Return (Year-End) Rate Relief Amount Rate (Ann.) Rate (Ann.) 35 2012 $3,000 0.0% $3,000.00 26.0% $780 35.02% 36 2013 $3,000 0.0% $6,000.00 26.0% $780 21.81% 37 2014 $3,000 0.0% $9,000.00 26.0% $780 15.82% 38 2015 $3,000 0.0% $12,000.00 26.0% $780 12.41% 39 2016 $3,000 0.0% $15,000.00 26.0% $780 10.20% 40 2017 $3,000 0.0% $18,000.00 26.0% $780 8.66% 41 2018 $3,000 0.0% $21,000.00 26.0% $780 7.53% 42 2019 $3,000 0.0% $24,000.00 26.0% $780 6.66% 43 2020 $3,000 0.0% $27,000.00 26.0% $780 5.96% 44 2021 $3,000 0.0% $30,000.00 26.0% $780 5.40% 45 2022 $- 0.0% $30,000.00 0.0% $- 4.60% 46 2023 $- 0.0% $30,000.00 0.0% $- 4.01% 47 2024 $- 0.0% $30,000.00 0.0% $- 3.54% 48 2025 $- 0.0% $30,000.00 0.0% $- 3.17% 49 2026 $- 0.0% $30,000.00 0.0% $- 2.87% 50 2027 $- 0.0% $30,000.00 0.0% $- 2.63% 51 2028 $- 0.0% $30,000.00 0.0% $- 2.42% 52 2029 $- 0.0% $30,000.00 0.0% $- 2.24% 53 2030 $- 0.0% $30,000.00 0.0% $- 2.08% 54 2031 $- 0.0% $30,000.00 0.0% $- 1.95% <--- Result 55 2032  (i.e. annual income > 100k or approx 9k per mth) |
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Nov 29 2012, 09:07 PM
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#4
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Junior Member
291 posts Joined: Dec 2007
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QUOTE(gark @ Nov 29 2012, 01:58 PM) Nowadays is much more common than you think.. mid level managers (~10-15 years experience) working in KL MNC can easily hit that amount.... QUOTE(ronnie @ Nov 29 2012, 02:12 PM) Also Year-end Bonus is taxable... if i not remember wrongly, our per capita income is abt 28k p.a.the illustration of the 1.95% seems only for a small group of ppl. |
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